Home Health & Hospice Week

Nine areas of the country will see drastically reduced DME reimbursement and altered supplier availability in the new year.

The Centers for Medicare & Medicaid

Services has announced its bid prices for the durable medical equipment competitive bidding program that takes effect Jan. 1. On average, CMS will pay 32 percent less for bid items under the program, the agency says in a release. That will strip out $17 billion in DME payments over 10 years.

For example: Concentrators will go from $173.13 to $116.16 per month under the program. Hospital beds will go from $127.12 to $80.35 per month. And diabetic supplies will decrease from $75.32 to $33.44 per month, CMS says in the release. "Few involved in DME believe that these rates are sustainable," says the National Association of Independent Medical Equipment  Suppliers.

"It seems unlikely that suppliers will be able to maintain operations at these prices." "The bid prices announced by HHS today will translate into unsustainable reimbursement rates for home care providers," insists the American Association for Homecare. "Over time, it will make it harder for seniors and people with disabilities to get the home medical equipment and services they require to live independently in the most costeffective post-acute setting -- their own homes."

Bottom line: "Ultimately, the below-market rates achieved through this bidding program will force thousands of businesses to close, reducing competition in the long term and reducing seniors' access to care and choice of providers," AAHomecare warns in a release.

CMS insists that the program isn't cutting small suppliers out of the Medicare business. "Small suppliers, those with gross revenues of $3.5 million or less, make up about 48 percent of the suppliers that will be offered contracts," the agency says. CMS is contacting suppliers with contracts now and plans to announce the contract suppliers in September. Suppliers continue to lobby Congress to eliminate the bidding program, which they call "suicide bidding."

The bidding program is not a valid fraudfighting tool, they say. "To characterize the bidding program as an anti-fraud mechanism is extremely misleading," AAHomecare protests. "The real solution to keeping criminals out of Medicare is better screening, real-time claims audits, and better enforcement mechanisms for Medicare." CMS plans to expand bidding to 91 MSAs in the next round, it says.